I have a card with one bank (that I am trying my hardest to pay off ASAP) that is 24% APR. It is killing me. A week or two ago, you had an article about a woman who paid off all her credit card debt over the course of 20 months or so. Good for her and it was a good story. One thing about it had me wondering though. She said that she negotiated with her lenders to get lower interest rates on her cards. How do you suggest I do that?

Here's what:

24%?! Good god man, get the heck out of there. You tell them to lower it or you're transferring the balance to another card with a better rate and canceling the account. Find a better credit rate at billshrink or bankrate. You may even qualify for an 0% balance transfer.

Here's what you say:

"I think I've been a good customer. I'd like to stay with you, but I really want you to lower the rate on my card. Can you help me?"

If they say no, ask to speak to a supervisor and say the same thing. If they still say no, plug in your research into the following statement:

"____ and ____ and ______ credit card companies are offering me rates of ____ and _____ and _____. Can you match them or do better? Otherwise, I think I might have to take my business there. I really want to pay off this debt, but it's hard to get ahead with the interest rate you're charging."

Skeptical? CBS News approached 10 random shoppers in a mall and had them read the first script. 6 of them were able to get their rates lowered right on the spot.

(Photo: Getty)

UPDATE: The 43.5% APR is the effective APR after you include the £150 annual fee. Like commenter Hanke wrote, "It's just like those payday loan places, where although the actual interest rate is low, the fees associated with the service give you a 300%APR." Makes you wonder, though, what about all those American credit cards with annual fees? Their effective APR is also higher then, and as far as I know, they don't have to include the fee in the stated APR (big print or no).

British Airways American Express [Official Site] (Thanks to Kerwin!)

To get his cards reopened, James spoke with a rep and said he was perfectly capable of transferring his balances to another card with another company with a lower APR, but since he had been a customer since 1990, he wanted to work something out. She replied that "we are past that point" at Bank of America "wasn't interested." James then emailed Diane Morais, VP of National Customer Experience, but perhaps he should also try writing a letter to the CEO (it works!). Either that, or put his money where his mouth is and break up with BoA.

(Photo: Getty)

Justin writes:

Last May I traveled to Las Vegas to get married. In booking my travel trough American Airlines Vacations I used an American Airlines credit card as I would receive 6 months same as cash when using that form of payment. Now this was the card issued by Citibank for the airline, but was not an actual visa/mastercard. I had paid off the card after returning from our trip.

We already had plans for a trip in May of '08 to go to Walt Disney World so given the experience that we had with American, we had planned on financing and booking our trip through their vacation department. I had every detail planned and proceeded to book online. Everything was in order and I went to pay. I couldn't enter the credit card as payment because of the lack of an expiration date on the card. No big deal as I then remembered that I had the same problem when booking the Vegas trip, so I called the credit card issuer and they informed me how to remedy the problem. Alas, I was back to the excitement of booking a Disney World vacation for my family! Still didn't work? Okay. I then decided that the best option would be to call directly and book. And here is it where it gets interesting.

I get in touch with an agent and proceed to go over the vacation that I had saved online from earlier. Everything was the same and sounded great. I gave the form of payment and was placed on hold. I was relieved and knew that everything was going to be o.k. Alas the agent gets back on the line and says "Sir, I am sorry but we don't accept this card". I ask " You mean to tell me that American Airlines does not accept their own credit card". I was then informed after being transferred to a supervisor and explaining that I had used the same card to book my previous vacation that they had recently switched to a new "system" and that the bug in the system would not let them accept the American Airlines credit card. I asked if this was just a "bug" if you will, then how long will it be before it is fixed? No one could provide an answer. Imagine that!

So after several e-mails to customer service, several phone calls to reservations and my own research I have yet to hear an answer or explanation beyond that. Granted I could have just said okay well then put it on another card. But that isn't the point. We only have one other card for emergencies and light spending and rely on it for an emergency. I had paid this card off as fast as possible in anticipation of our next trip and now after everyone is exited (including my 5 year old daughter) about finally getting to go to Walt Disney World we are being denied our only means of paying for the travel portion of our trip.

My only hope is that this at the least gets some attention. I know people will say that we could simply finance by another means, but the fact is as we live comfortably, we just can't afford to finance this vacation with our finances that were allocated for spending money and still afford to go. I just feel cheated by the Airline for not thinking or considering how many people this could effect that aren't the frequent fliers or substantial customers.

Rather than use AA's extremely limited card, it would be wiser to deposit the would-be credit payments into a free high-interest savings account. Assuming debt that can't be immediately satisfied opens you and your family to a world of financial pain that could be avoided by saving before paying. Even those playing the 0% APR game need to be able to pay off their credit card bill in full every single month.

American Airlines Credit Card [AA.com]

"Chase quite often if they see someone getting somewhere near their credit limit, but never exceeding their credit limit, will nevertheless bump that person up," [Joe Ridout of Consumer Action] said.

While Citibank announced this year it is pulling back from random interest rate increases, Ridout said Chase is forging ahead.

"We get more complaints of this nature from Chase than from all other issuers combined," Ridout said.

Credit Card Interest Rate Hike - Is it Unfair? [ABC 15]
(AP Photo/Amy Sancetta)

50 Credit Cards Offering 0% APR on Purchases [Consumerism Commentary]

2) Thou Shalt Get A Credit Card With Extended Warranty Protection, Cash Back or Reward Points, And Thou Shalt Take Advantage Of Them.
Credit cards can be very useful tools for consumers. Extended Warranty Protection can double a manufacturer's warranty and costs you nothing. Cash back, obviously, saves you cash. Reward points are useful for lots of things. Take advantage of these tools! They're there for smart people like you.

3) Thou Shalt Check Your Credit Report.
Go to annualcreditreport.com to check your credit report. It's free and you can do it once a year. If there's something incorrect on the report, you can challenge it. Removing old or incorrect stuff from your credit report will cause your FICO score to rise, and that can save you money.

4) Thou Shalt Pay All Bills On Time.
Paying your bills on time helps your credit score and keeps you from having to pay fees. Do it!

5) Thou Shalt Avoid ID Theft. Buy And Use A Shredder, and Thou Shalt Not Fall For Phishing Scams.
ID Theft sucks. It's not always your fault, but you can take simple steps to help prevent it. Be aware of phishing scams and don't fall for them. Always type urls into your browser, don't follow links from emails. Don't save your banking passwords in your browser or on your computer. Buy and use a shredder. None of these steps takes much effort, but they go a long way towards protecting you. Sure, your credit card protects you from a lot of the financial damage from ID theft, but there's no reason you can't be responsible about protecting yourself.

6) Thou Shalt Take Advantage of No Interest No Payments Financing Deals, But Thou Shalt Pay Them Off On Time.
No interest, no payments financing can be great, but you've got to ignore the "no payments" part. Make payments. If you don't, once the "no payments" period is over, you're going to get hit with interest from the date of purchase... and that interest rate can be huge. Don't do this! Use the "no payments" period to pay the item off, then you've used the store's money for free.Yay!

7) Thou Shalt Avoid Interest On Consumer Debt. Thou Shalt Try To Pay Interest Only On Student Loans, Mortgages And Car Loans.
Sort of self-explanatory. It's not a wise investment to be paying interest on soap and tacos. If you don't have enough money to pay your balance off every month, look for ways to cut your spending.

8) Thou Shalt Keep Thine Credit Utilization At A Reasonable Level.
Credit utilization is important to your FICO score. Basically, you don't want to use all the credit available to you. Don't max out your credit! Lenders will approve you for more than you can afford. Remember that.

9) Thou Shalt Not Cancel Credit Cards, Thou Shalt Try To Keep Them Open So As Not To Shorten Thine Credit History.
Length of credit history is important to your FICO score. If you don't want to use a card that you've had for a long time, that's fine, but don't actually cancel the card. Just don't use it, unless it has an annual fee and you really want to get rid of it.

10) Thou Shalt Not Constantly Obsess Over Thine Credit Score. Life is too short.
Following these commandments should help your credit score, but remember that its not written in stone. It's more of a snapshot than a grade. It can always go up and down, and it will. While it's important to be mindful of your credit report, don't let it ruin your life. Smile.

We know you have your own commandments to share, so leave them in the comments and help our readers learn about managing their credit wisely!
(Photo:MykReeve)

Jared writes:

Dear Consumerist,

I was performing my new monthly task of calling all of my credit companies and asking for a lower rate. One of our cards is a Citi Premier Pass, which is part of the "Thank You" Network. We got the card for the balance transfer and for our honeymoon (they offer triple points for purchases on cruise ships) and in the end, we got $100 in Amazon gift certificates and a $10 Starbucks card - but I digress.

I asked the CSR last night if I was able to get a lower rate on the card. She pulled up my account information and told me that, no, we weren't, because the card is already at the lowest rate possible, which is the 14.24% listed on the website. I asked her why that was the lowest rate, and she said that it was because of the rewards that the card offered.

My question is: do all rewards cause the APR of a credit card to go up, and if this is the case, is the points pay-off worth the higher APR?

~ Jared

Jared,

No, it's not worth it. Reward points are for people who do not have a balance on their credit card. If you have a balance (and we're going to assume that you do because you're concerned about your APR) that should be your primary concern.

Get the lowest interest rate you can. Period. Then pay your balance off as quickly as you can. Carrying a balance on your card negates any "savings" you're getting from the reward points.

If you have no balance on the card, then by all means take the card that offers the highest rewards, regardless of APR. If you're not paying interest, why do you care what the rate is? Just make sure that you really will pay your balance in full, because reward points are intended to entice you to spend more than you can afford.

(Photo:el en houston)

Hi Meghann, nice work on Consumerist. You all do a great job, and I enjoy the blog, read it a lot, and learn a lot from it. I thought I would run a situation/question by you and see if you all have any answers or know where to find them.

I follow all the sneaky stuff credit card companies do, like increasing your interest rate if you are late on another payment. A few weeks ago I got a letter that my balance had been doubled, even though I had never asked for it to be.

Last time I checked my credit rating, I had no late payments on anything, and my score was pretty good (700+ I believe). Anyhow, while paying bills last night I noticed that my credit card charges me 18% on newer charges, and 30+% on charges before Jan 2006!! 30%!! Highway robbery.

So I don't know if you can answer any questions or point me in the right direction, but my questions as a consumer are:

1) What are my chances of getting the interest rates lowered if I call and threaten to cancel my account and transfer the balance to another card. I get dozens of credit card offers for much lower interest (in the short term) in the mail weekly.

2) Is it true that having a credit card for a long time helps your credit? I have had this card for 14+ years and would hate to cancel it and ding my credit.

3) If I open a new account to transfer the balance too and leave the original credit card active (but with no balance) will adding the new card ding my credit?

I am thinking if I got a card with 6% interest for 1 year, I could transfer the balance, and with the difference in interest rates, pay a huge chunk off vs what I would do paying the same amount on the older card. But at the same time, if I can threaten to pull my account from the original card and get a lower rate, I would rather do that.

Any pointers, tips, or thoughts?

Thanks,
Brian

Hi, Brian. Thanks for writing. Don't worry, you concerns are not unusual. With so much importance places on your credit score, lots of people are in a panic not to disturb the beast. Thankfully, nothing you're about to do should hurt your score that much.

Let's answer your questions one at a time:

1) What are my chances of getting the interest rates lowered if I call and threaten to cancel my account and transfer the balance to another card. I get dozens of credit card offers for much lower interest (in the short term) in the mail weekly.

This depends entirely on your bank. The good news is, it doesn't cost anything to try! What you'll want to do first is research the best credit offers. There are several websites that help you do this! Armed with the knowledge of another bank's offer—call your bank and ask them to match it. If they won't, then they won't, but you've lost nothing because your research for the next step is done.

2) Is it true that having a credit card for a long time helps your credit? I have had this card for 14+ years and would hate to cancel it and ding my credit.

Your credit score is broken up into several categories that are considered when calculating your score. One of them is length of credit history. So, yes. Closing this account would shorten your credit history. Thankfully, you don't need to close it. You can leave it open and transfer your balance.

3) If I open a new account to transfer the balance too and leave the original credit card active (but with no balance) will adding the new card ding my credit?

Uh, sort of. New applications for credit have an impact on your score, but not a huge one. If, say, you go around applying for and getting denied from 12 credit cards a day—yeah, that's bad. Simply opening a new card that you can afford? You'll be fine.

So to sum up: Research the best offers available to you. Call your bank and ask them to match them. Act accordingly. Keep your old card open, but don't run up another balance. Pay off your balance!

Sound like a plan? Good luck, Brian! Any suggestions for Brian in the comments? Have you been there? What did you do? —MEGHANN MARCO

BRIAN'S HOMEWORK: Easily Compare Best Credit Card Offers
HOW TO: Play 0% Balance Transfer Credit Cards For Fun And Profit
Discover: 0% APR For Life Decoded
Save On Your Credit Cards With Savings Agent
Attention: You Lowered Your APR Just By Asking, Again.
Attention: You Rock At Lowering Your APR

(Photo: Sam Wilkinson)

Although this is renting-to-own, it is still an extension of credit, similar to a contract for deed in the real estate world. In either case, you get something you haven't paid for and, more importantly, do not have an ownership interest in. If you stop paying, Rent-A-Center gets your money paid so far as well as the furniture. The wisdom of this is, of course, dubious from the get-go.

In this case, it works out to a 122% APR. That kind of makes Rent-A-Center the payday lender of the furniture world. As JLP points out, you could sit on the floor instead and own that furniture outright in only 39 weeks. No savings account? Coffee cans buried in the backyard aren't a bad idea. — SAM GLOVER

(Photo: amyadoyzie)

Like the rest of the credit world, counseling services have good guys and bad guys. MSN offers several ways to identify a bad guy:

• They ask for a high upfront fee: $10 is appropriate. $1,000 is not.
  
• They lack accreditation: Make sure your counseling service belongs to the National Foundation for Credit Counseling or the Association of the Independent Consumer Credit Counseling Agencies.
  
• Crazy Promises: Counselors are not magicians. They can help manage debt, not make it disappear. They cannot pull a rabbit out of a pigeon in a hat. That quarter in their hand, the one that came from behind your ear. It's yours.

The Consumers' Guide to Credit Counseling [MSN Money via AllFinancialMatters]
National Foundation for Credit Counseling
Association of Independent Consumer Credit Counseling Agencies
(Photo: saibotregeel)

"The big risk in doing this is that if you can't pay off a credit card, it's not that bad. Since it's unsecured credit, they can't come and legally seize anything (unless you go bankrupt, and even then your home could be safe if you live in a state like Florida). If you pay off your credit card with a home equity loan and then you can't pay off that home equity loan... they will come and take your house."

So if you're still the irresponsible home theater system charging rascal you once were, you might want to think carefully before you risk your house. You could use a 0% balance transfer, for example, to cut your interest without additional risk to the place where your children sleep. On the other hand, if you're truly on the straight and narrow...—MEGHANN MARCO

Pay Off Credit Cards with Home Equity? [Blueprint for Financial Prosperity]

•Be aware that the card issuer has a great deal of leeway. They reserve the right to change the terms of your card, including the APR (annual percentage rate), at any time, for any reason—with as little as 15 days notice. So check your monthly statement carefully.

More inside.

•There is no limit on the fee a credit-card company can charge a cardholder for being even an hour late with a payment. That's due to a 1996 U.S. Supreme Court decision (Smiley v. Citibank) that lifted the existing restrictions on late penalty fees. Today, $30 is the most common late fee, according to the Consumer Credit Counseling Service. Ten years ago, that number was $13.

•There is no federal limit on the interest rate a credit-card company can charge. Take a look at your credit-card statement. Most likely, the return address is located in a states where state governments have weak "usury laws."

Plastic Predicament [Newsweek]

Discover's 0% APR "For Life" offer is for balance transfers. It provides that as long as you maintain 2 transactions per month, you can keep your "intro" 0% APR on your balance transfer...for life.

The Catch:
The reason you are required to maintain at least 2 transactions per month is that any payments you make to Discover are applied to the amount with the lowest interest rate. Meaning you have to pay off your entire balance before any of the money you pay is applied to the new (higher APR) charges. From DiscoverCard.com:

Savings Agent [Dumb Little Man]

Read Jacob's email inside.

Jacob writes:

Lee was charged a late fee on a Chase card payment, even though he mailed the check ten days before it was due.

When he called to complain, Chase refused to remove the fee and told Lee they, "had no control of the U.S. Postal Service."

Shortly thereafter, his APR magically rose to over 148%. Read his letter inside.

Lee writes:

Lee, have you disputed the report ding through the credit bureaus? That would seem the first place to start. — BEN POPKEN

Previously, accounts 180 days past due were not billed overlimit fees, making it easier for the average holder to catch up.

Beginning this month, Chase will continue to bill customers overlimit fees past the 180 days.

Worst case scenario, customers are paying $39 overlimit fee, a $39 late fee, and a 32.4% interest rate.

The fee continuation comes on the heels of CHASE's raising of the default credit card APR from 29.99% to 32.4%.

Our inside tipster writes:

"It comes across as arrogant and without the "values" that chase seems to insist on having. Yes, customers have gone over the limit. But why continue to bill them a 39.00 late fee AND a 39.00 overlimit fee along with a 29.99 interest rate?

I feel that it's only fair to let the consumer know what credit card companies are doing to make even more money and pulling it from the pocket books and purses of those who are already struggling to make ends meet."

Remember, try to only use a credit card if you can pay it off in full every month. Otherwise you're a worthless piece of chattel and the banks will rape you hard, and in the butt. — BEN POPKEN

The letter indicated Chase was changing the default APR to 32.4% (up from 29.99%). The notice said customers could send in a letter and opt-out of the changes.

Acting on Consumerist advice, Reader Ed wrote such a letter and went to DisneyWorld, where he found his card denied when trying to pay for fish and chips at the English Pub in Epcot.

We called Chase for clarification. They told The Consumerist that customers need to indicate in the opt-out letter that the account should remain open, otherwise it will be closed by default. Nowhere on the letter does it say anything to this effect. Here's the call.

Misleading! Shame! Fire the copy editor! Call transcript, Ed's letter, and a reprint of Chase's terms of service change notice, inside... — BEN POPKEN

Call Transcript

Ed writes:

Previously: Beat Chase's New 32.4% Default APR

Your default APR is going up to 32.4%, but you can opt-out if you send them a letter by November 24th. Your account will not be canceled if you reject the changes.

If you threw away your notice, we posted it inside.

Check out Mouseprint for a deciphering of the other changes listed in the notice. — BEN POPKEN

I bank with Chase and I have my only credit card with them and that keeps things simple.... After reading some articles on your site I decided to just call and ask them to lower my rate. They transferred me to a credit analyst who got some information from me and agreed to lower my rate back the lower rate I had been paying and also refund what I had been paying in higher interest payments. It's all thanks to you guys at Consumerist.
You rock!

No, Stephen. You rock.— MEGHANN MARCO

The rest of Stephen's email inside.

Reduce Credit Card APR: It Never Hurts To Ask

Consumerist,

I just wanted to say thanks. Your site really helps out and I'd like to tell you my story of how.

I bank with Chase and I have my only credit card with them and that keeps things simple. Lately they just decided to raise my APR and I made a fairly large payment on my credit card balance so when they raised my APR my newest finance charge was more than my last minimum payment. After reading some articles on your site I decided to just call and ask them to lower my rate. They transferred me to a credit analyst who got some information from me and agreed to lower my rate back the lower rate I had been paying and also refund what I had been paying in higher interest payments. It's all thanks to you guys at consumerist.

You rock!

Oh, and threatening to leave.

While we've heard this one before, we think the way she went about it is pretty classy.

Her letter, inside.

Acambras writes:

"So I'm on the phone with Citibank last night. I wanted to find out exactly what my interest rate was on my Citi Mastercard, but didn't have a current statement available and the website was asking for a scary amount of information. So I go through the rigmarole of calling, entering my account number, telling the CSR my account number, verifying my identity, etc.

She told me my rate was 13.99%. I mentioned that was the highest rate on any of my credit cards and asked if I could qualify for anything lower. She said no, but that I could try back in a month or so.

I thanked her for her time and began to wrap up the conversation (very politely) something along the lines of this:

"Well, you can probably see on my account activity that I'm no longer charging any purchases to my Citibank card, and that in fact I've transferred some of the balance to other, lower interest cards. There are plenty of offers out there for much better deals, so don't be surprised when you see my Citibank balance get transferred elsewhere."

And presto! She quickly transfers me (to a "retention specialist," I suspect, although she never used that term). "Travis" bumped my rate down to 3.99% (on the current balance and future purchases) for the next 9 months. Sure, I would have liked more than 9 months, or less than 2.99%, but this wasn't a bad deal for less than 10 minutes on the phone (plus about 5 minutes of hold time).

The moral to this story: IT NEVER HURTS TO ASK. In fact, I think I'll call the other credit card companies tonight."

If the stated rate is 5%, and you put in $100, how much do you get after a year? You might say $5, but thanks to the magic of compound interest, it's actually $5.13. Multiply that by more time, bigger principal, and the difference could be huge.

AllFiancialMatters has the magic formula and a little more explanation.

She's not happy, though, as he keeps getting her the cheap stuff, the trinkets that come on the glossy inserts of his credit card statements. It's not that she's greedy, it's just that she can stand uninformed consumerism.

"It isn't the jewellery he finds seductive, but the lure of acquiring something that sounds like a bargain at an absurdly reduced price," she writes.

Eilidh uses this as a launch point into a screed about her senior friends who can't don't understand that downloading the singing, dancing hippos is an invitation for spyware, and the concept of using throw-away emails to thwart spam. She's dismayed that these intelligent gents can't adapt to a modern, duplicitous world of 29% APRs, sneaky value-added services and relentless telemarketers.

"They don't want to accept that now they have to be as careful when dealing with banks and lending institutions as they once had to be when they ordered a body-building kit from the back pages of a Marvel Comic," says Eilidh.

All this, inspired by our little ol' post, "Laptop Reward Traps the Myopic" about a credit card that was offering a "free" laptop with signup.

Careful and involved readership like this deserves commendation and reminds us why we get up in the morning.

Eilidh's letter, after the jump...

"RE: Laptop Reward Traps the Myopic
—-—-—-—-—-—-—-—-—-—-—-—-—-—-—--
Sir:

Great Website.

My late father used to say: 'People see what they want to see.'

The issue of the 'free' notebook is similar to much of the cheap rubbish offered by the credit card companies to their 'special' customers.

A close friend, a much older man, is constantly buying me those diamond bracelets, and gold and gemstone rings offered at impossibly low prices in the glossy inserts he receives with his credit card bills. I have repeatedly asked him not to buy these items. If he saved that money instead of spending it on cheap, tawdry rubbish, once a year he could buy me something nice that I would enjoy wearing. I show him ads where local shops have 50% off sales. I point out that the $300 earrings I fancy are selling for $150. That $150 is less than the total he is paying out for those ugly poorly-made rings and bracelets he is ordering.

Does he listen? No. He continues to call me up to tell me he has ordered another ring, adding that it didn't cost much so if I don't like it, it doesn't really matter.

It isn't the jewellery he finds seductive, but the lure of acquiring something that sounds like a bargain at an absurdly reduced price.

The man is reasonably intelligent. And yet, no matter how many times he has heard from others, and from me, not to open and read even those few spams whose subject lines interest him, he does it anyway. My stepfather could never be dissuaded from reading spam. 'I want to see what it says', he used to explain, looking at us with that I've-been-a-bad-boy smile.

The reader can guess who is frequently summoned to fix the men's PCs, since neither can be bothered to do the manual upgrades to the anti-spyware apps I installed, much less run them to keep the computers clean. Both my stepfather and my friend install those cutesie apps that put FREE dancing smileys and jigging cursors on their systems even though I have repeatedly warned them that these programmes contain spyware. 'But they're FREE', the men remind me whilst complaining that their systems aren't working right.

They complain about the quantity of spam they receive. They don't understand how giving out their primary e-mail address to Publisher's Clearing House Sweepstakes contributes to the problem. They refuse to accept that opening spam leads to more spam. Not one of my elderly friends can be bothered to use the free throw-away e-mail account I set up to prevent their primary address from being spammed. The idea that every individual is a target for con men is lost on them. That some of the cons come from bona fide financial institutions is a concept that to them is simply not credible.

I have no doubt that if the offer of the "Upfront Reward" VISA Platinum card by Universal Savings Bank came across their desks, each of these men would snap it up. Neither man has sufficient patience to do the comparative research necessary to determine whether the deal is a good one.

The problem is based on something deeper. Both of these men, and others like them, spent their early years and most of their adult lives in an America that was far more honest and straightforward than the society in which we are now living. People who ordered items advertised in the back pages of comic books and some magazines knew they were dealing with shady merchants. They sent off their orders with the understanding that they might not receive the item as it was depicted in the ad. Not all banks and large corporations were completely trustworthy, but for the average citizen it was reasonably safe to buy a Chevrolet or a Frigidaire, and to do business with an American financial institution. The free toaster offered by a bank was simply what it was called; a 'free gift'. These people remember when it took a call of no more than three minutes to cancel a subscription.

This was before the US became a society where people have to examine every bill that comes in for opt-outs and 'value-added' upgrades and services that companies slip into the bill that add to the charge. After a purchase people were not harassed by repeated calls offering additional services, as my mother recently was after buying her first PC, a Dell notebook. In her frustration she called me from the other side of the country to ask what she had to do to make them stop bothering her.

My two dear old men are anchored in a world that has largely disappeared. At some level they must realise that the values they depended on during the first forty years of their lives are no longer operating in many present day American institutions. They don't want to accept that now they have to be as careful when dealing with banks and lending institutions as they once had to be when they ordered a body-building kit from the back pages of a Marvel Comic. When they order tawdry jewellery, believing that the item will be of some reasonable quality because it is being sold through a national financial institution, and when they open spam, convincing themselves that reading something sent to their in-box by some stranger is harmless because it comes through their ISP, they are seeing what they want to see. These are the sort of people who would believe that they are being offered a good deal when they sign on for the "Upfront Reward" VISA Platinum card by Universal Savings Bank and receive a 'free' Dell notebook.

Recently I got into an argument with my friend over interest rates that credit cards are permitted to charge customers. He claimed that rates of 29% are illegal under usury laws. I got on the Web and showed him that the safeguards that once protected Americans from usury and other extreme tactics by credit card institutions are gone. Interest rates of 29% are common. This man, a conservative Republican of the old school, was shocked. He hadn't realised how far corporate depredation had been allowed to go. It isn't as if there haven't been articles in the newspapers, and specials on PBS. He is seventy-six, and he doesn't want to see the world he cherishes collapsing around him.

What many people don't understand is that this isn't 1976, with the protections of those earlier times. It is 2006, and times have changed.

Other people who fall for this scam and others like it are younger people, under-educated na fs, many of them intelligent and hard-working.

People who sign on for the "Upfront Reward" VISA Platinum card by Universal Savings Bank will discover that they have far less protection under the law from predatory tactics than they believed.

Kind regards,

Eilidh M."

I'm done with your parlor game called Guess Your New Interest Rate! For the third time in 1.5 years, you goosed mine to 29.9%. I have been faithful to your tied-to-the-tracks 14-day payment window. I'm nowhere close to exceeding my credit limit. Lord knows your reason this time. Crooked stamp?...

Something is causing you to play this game. Wall Street? Revolving debt did drop $1.5 billion in March. Not good for revenues. A Wall Street knife to your throat is scary.

A computer simulation guessing that people like me won't notice our rates have tripled? That might be it.

It's the plight of guys like Ben who pay their credit card bills faithfully every month that makes me — a man who pays his credit card bill only when he happens to remember it — positively tremble at the prospect of breaking out the old magnifying glass and checking out my fine print.

Cutting off Amex [Church of the Customer Blog]

John from New Falsmouth, Massachusetts had an existing credit card with a respectable 9% APR. A decent rate — most of us would hold onto such a card with our very life's breath. Nevertheless, he was tempted by an offer for a Household Bank platinum card that promised a 0% APR for the first twelve months. So he decided to transfer his credit.

After reading the fine print and all the forms, John sent in the balance transfer check he had received from Household Bank. The problem? The bank had sent John the wrong form and they transferred his balance over with a whopping 29.31% APR extra! And not only would Household Bank not budge, but the check bounced because of the exorbitant interest, which led John to rack up late fees, raising the rate even on his lower cards.

Only summary needed: don't get a credit card from Household bank.

Zero To 30 Percent In Just One Month [Consumer Affairs]

Her story serves as a good reminder to read the finance contract with care and if you believe you're being screwed, be vocal and persistent in pursuing your grievance.

If a business doesn't believe the customer is always right, guess what? The customer will spend somewhere they're not wrong.

M.'s dealership knew this and that's why in the end, she wins. Read more, after the jump...

M. writes:

"I recently bought a new car and bout 30 minutes after my husband and I left the dealership, our financier called us. He told us there had been a mistake made on the finance contract that we signed. He accidentally gave us a 2.9% APR AND $2,000 in rebates and customer loyalty incentives. OOPS! He thought we were buying a different car and gave us the incentives for the wrong model. The model I bought offered a special 3.9% financing rate OR a $500 rebate (almost all car incentives work this way — either/or on financing and rebates.) He not only gave us the wrong rebates and incentives, he gave us BOTH rebates and the incentive APR.

When we arrived at the dealership, the financier, along with the business manager presented us with a new "correct" contract. We were extremely hesitant to sign this new contract, under the common understanding that once a contract is signed, it's legally binding. When we asked the business manager what would happen if we did not sign the new contract, he told us that the entire deal would be undone and we would have to give back our new car. He told us that the bank would not accept the first contract and that it would be declared null and void. For our troubles, they threw in a free oil change and car detailing. OUCH. Talk about rubbing salt in our wounds!

We spent the entire weekend fuming and called the general manger of the dealership first thing Monday morning. He apologized and invited us back to the dealership to present us with a new deal... a GREAT deal. First, we got the original 2.9% financing back. The dealership basically had to redo the finance deal with another bank and buy down the rate. We also got $1,000 in rebates AND a four year service plan. When we added up the costs on their recommended pricing and maintenance schedule, it added up to more than $1,200.

EDUCATE yourself about the car buying process and read the finance contract carefully!! If you believe the dealership has made a mistake, be persistent in contacting the people in charge — going higher up the management ladder if necessary. The dealership made the right move in correcting the mistake and going above and beyond for something that they bunged up in the first place."

The program then generates an appealing table of what you ll have to pay and for how long, like so for $1800 at 10.25% APR with monthly payments of $50.

It s also a great tool for while considering big-ticket purchases, like figuring the long-term ramifications of plunking down the signature loan for that force-feedback bookshelf.

And after you're down staring down the long abyss of debt, you can turn the graph into a decorative tea cozy.

[via Lifehacker]